How Normal Bros Buy Million-Dollar Businesses
The US Gov Will Give You $5M to Buy a Business ( Here's How )
Most people think you need rich parents or a trust fund to buy a business.
Wrong.
I mean, it helps, but if you’re like me, you’ve got neither.
Fun fact: The U.S. government will literally loan you up to $5 million to acquire a cash-flowing company! They’ve been doing it since 1953. And yet 90% of people have never heard of it.
OK, maybe ‘never heard of’ is extreme, but I bet you didn’t think you’d qualify, or it would be a gigantic pain in the ass, right? I know I did.
Well BuyBros, today is your lucky day. I’m breaking down the SBA loan - what it is, how it works, and how to actually get one when you find the right deal.
Welcome new BuyBros to The $10M Acquisition Journal 🎉!
Pssst …. if you didn’t catch the last edition of the $10M Acquisition Journey 👇
The Government's Weird Gift to Regular People
SBA stands for Small Business Administration. It’s a federal agency that exists for one reason: to help regular people own businesses.
Now, I’m not the biggest fan of the gov, but this one part of it is actually beneficial for us FreedomBros™️.
Here’s the play: The SBA doesn’t lend you money directly.
Instead, they
Guarantee a portion of your loan to a bank
This makes banks comfortable lending to studs like me ( and maybe you lol ). Regular ass bros without seven figures of liquid cash sitting around.
I think of it like having a wealthy uncle co-sign your loan. The bank takes less risk. And now I now get access to capital I’d have a tough time qualify for otherwise.
The most common loan for acquisitions is the SBA 7(a). It can go up to $5 million with terms stretching 10-25 years depending on what you’re buying.
The interest rates are usually prime plus 2-3%. Not cheap, but not predatory either.
Side note and disclaimer:
idk if/how SBA works, or what name it would be, in your own country - if you’re outside of the states.
DYOR, ya bum!
Don't Be The Guy Scrambling For Financing
Here’s where people get tripped up.
They find a deal. They get excited. Then they realize they have no financing in place and the seller moves on to someone who does.
Dead deal. Wasted months. Remember: TIME KILLS ALL DEALS
Good news is that the fix is simple: Just get pre-qualified BEFORE you start hunting 🎉.
A pre-qual letter is basically a bank saying “yeah, this person looks legit based on their net worth and background.” It takes a few days. It costs nothing. And it signals to brokers and sellers that you’re a serious buyer—not some tire-kicker wasting everyone’s time.
I can personally attest, that before I joined the acquisition entrepreneurship community I’m in, I had sent out a lot of inquires to brokers. Zero fkn responses. Now that I use the language they’re looking for AND casually drop I’m SBA pre-qual, response rate has skyrocketed 📈.
You can get one from any bank that does SBA lending, or use the national SBA website to match you with lenders in your area. I will note, there are SBA preferred lenders ( which I used ). So they’re very familiar with the process and have better underwriting and deal structuring.
Balding Larry from your local bank will be in over his head … which, to be fair, isn't hard when there's nothing up there
I digress, once you actually find a deal and submit a Letter of Intent ( LOI ), here’s what happens:
You send the deal details to your bank
They run their own quick analysis ( few days )
If they like it, they give you a deal-specific pre-qualification with general terms
You submit full paperwork
Underwriting takes 4-6+ weeks
Close
Ownership unlocked 💪
Total timeline from LOI to closing: Usually 60-90 days if you’re organized. Longer if you’re scrambling.
Good News For Guys Who Hate Debt
One question I kept seeing: “What if I want to pay this off early?”
Good news.
Any SBA 7(a) loan with a term of 15 years or less has zero prepayment penalty. Pay it down as fast as you want. Surprisingly nobody cares.
For terms over 15 years, there’s a small penalty that phases out:
5% in year one
3% in year two
1% in year three
After year three, you can pay up to 25% of the principal annually without penalty. After that window, pay it all off whenever.
Not a big deal unless you’re planning to flip the business fast.
Why This Should Piss You Off ( In A Good Way )
The SBA loan is the great equalizer.
It means a teacher in Ohio can compete with a private equity firm for certain deals. Although, I wouldn’t recommend it haha. PE is a whole new level of asshole. And, PE rarely looks at deals under $5M anyway, so you should be good.
It also means your savings account doesn’t determine your ceiling.
It means the path to ownership is open to people who actually want to run something. They’re not just financial engineers looking to strip it for parts.
Will you still need some money? Yes. Usually 10-20% down plus working capital ( Plus they typically like another 10% as a cash infusion - aka buffer ).
Will you need decent credit and some relevant experience? Probably.
But the whole point is that the barriers are lower than you think. Much lower.
TBH, the hard part isn’t qualifying.
The hard part is finding a deal worth buying ( and fits what you’re looking for ) and having the guts to pull the trigger.
Free Riders Exit Here
Look, everything above is the playbook. It’s free. Share it with whoever you want.
But knowing the game and actually playing it are two different things.
If you’re serious about this - like actually serious - I put together something for the jacked BuyBros:
✅ The SBA Acquisition Readiness Checklist ✅
It’s the exact list of documents, financials, and boxes you need to check BEFORE you talk to a lender.
The stuff that makes bankers say “this person’s got their shit together, give him money!” instead of ghosting all your follow-up emails.
One checklist. No BS. Just the tactical prep work that separates tire-kickers from buyers.
